I Can't Pay My Rent: What Should I Do?

Update: Due to growing financial difficulties brought on by COVID-19, the Treasury Department has distributed over $6 billion to states in an effort to help struggling landlords and renters. States have now received $30 billion in rental assistance, and more is expected to come in the following months.

According to the Bureau of Labor Statistics, housing is the most expensive budget item for average American households. It accounts for an average of 32% of all expenditures. With mortgage payments or rent drawing so heavily on consumer finances, it’s not surprising that sometimes people have to say, “I can’t pay my rent.”

A sudden loss of income, a personal emergency or a larger crisis—such as a global pandemic—can quickly cause someone to be unable to pay rent. But what happens if you can’t make rent? Find out what your options are below.

What Happens If You Don’t Pay Rent for a Month?

First, know that landlords typically can’t just change the locks and kick your stuff to the curb because you’re running a little late on the rent. In many cases, the landlord has to go through legal channels to terminate your tenancy first.

How the landlord terminates tenancy and seeks eviction depends on the laws of your state and the terms of your lease. But typically, it requires the landlord to provide written notice of the issue. You often have time after receiving the notice to correct the issue. If the issue is late rent, you can catch up payments or make arrangements with your landlord to do so.

It’s only if you don’t make good on the rent following a written notice that the landlord can move forward seeking eviction. In some cases, this might involve a lawsuit.

Steps to Take If You Can’t Pay Rent

Check your lease. Find out exactly what your agreement says about rent, whether you have a grace period and what your landlord’s options for recourse are. This helps you understand when your landlord might take action against you and whether you have time to come up with rent money.
Talk to your landlord. As soon as you know you can’t afford your rent, speak to your landlord. In many cases, honesty is the best policy here. You might be able to work out a deal to pay the rent late or make partial payments until you can catch up. Get any agreements about your rent payments in writing.
Make payments. Make partial or late rent payments as agreed upon with your landlord. If you ran late and can now pay your rent, pay it via check and get a receipt, and if your landlord won’t accept the payment, send it via certified mail so you have proof that you made every attempt to correct the arrears. This can make a difference if the landlord attempts to sue you or evict you.
Seek financial assistance. Some organizations offer loans, grants and other assistance to help people in financial hardship make rent payments. See the section below about getting help paying your rent for more information.

Rent Relief During Emergencies

If you experience financial distress related to a major national or natural disaster, you might be able to get rent relief. For example, the federal government passed rent relief measures as part of the Coronavirus Aid, Relief, and Economic Security Act.

Under the CARES Act, it is unlawful to evict renters living in federally guaranteed housing. That covers around 28% of rental units in the United States.

Even if you aren’t living in a rental situation covered by these types of relief packages, you may have some options. If you’re a good tenant who has always paid on time before, landlords will likely work with you during times of known emergency. Just let them know as soon as possible that you might need help—they need time to make their own financial plans to deal with a crisis.

For more information about protecting your finances during the COVID-19 pandemic, check out the Credit.com Coronavirus guide.

Where Can I Get Help Paying My Rent?

If you can’t afford rent this month but know you’ll be back on your feet in the near future, you can probably work something out with your landlord. But if you can’t—or you’re not sure if you can afford rent next month either—you may want to look into assistance options.

Local and state governments, churches and area nonprofits are all agencies that might offer rent relief programs. Contact local housing authorities to find out more about options, but here are a few places you might start.

Call 211 or check org. This is a free service from United Way Worldwide that helps people connect with a variety of assistance resources.
Salvation Army. The Salvation Army offers a number of emergency assistance and homelessness prevention programs, including help with rent. Search for a Salvation Army office near you to find out what assistance is available in your area.
Catholic Charities provides some assistance programs to help with rent when someone is facing imminent eviction due to an emergency.
Modest Needs also provides emergency rent assistance. You must complete a grant application online.

What Happens to Your Credit If You Can’t Pay Rent?

Remember that being late on your rent doesn’t just stress you out and make your relationship with your landlord difficult. It can also impact your credit. Some credit scoring models, such as VantageScore, might include rent payments, which may show up like an auto loan or like a charge card, depending on how your lease is structured.

Your good—or bad—rental history might also show up on rental screening products offered by the major credit reporting agencies. Being evicted or making no effort to work with your landlord can make it difficult to rent again. If you want to keep track of how late rent payments or anything else might be impacting your credit score, sign up for your free Credit Report Card.